MUMBAI — Indian retail traders lost $9.6 billion trading equity futures and options during the year that ended March 2026, according to a written reply from Minister of State for Finance Pankaj Chaudhary.
The losses represent a slight decline from the $13.2 billion recorded in the previous year, though the number of participating traders fell to fewer than 8 million from 9.8 million.
The Securities and Exchange Board of India (SEBI) initiated a regulatory crackdown after finding that nine out of 10 retail traders incurred losses in derivatives. SEBI had issued repeated warnings about the risks of competing against more experienced and better-resourced market participants.
SEBI increased contract sizes and imposed tighter position limits on options trading. In July, India's central bank introduced stricter funding rules for proprietary traders and stock brokers, further tightening the operating environment for derivatives participants.
The regulations are also affecting India's stock exchanges, which had benefited from the country's retail trading boom. The stricter oversight is reducing their operational revenues.
Data from the National Stock Exchange of India Ltd. shows average daily notional turnover for futures and options fell 23 percent in July to $2.2 trillion from June levels, reaching a 17-month low.
Abhay Agarwal, founder of Piper Serica Advisors, said both the regulator and government must address why losses continue year after year. "There is a need for more decisive actions to protect retail investors," Agarwal said.
